GST : Where best judgment orders under section 62 were passed for non-filing of returns, since belated returns were filed by assessee and assessee took plea of bonafide reason for delay, authorities should take note of returns filed and proceed to adjudic

HIGH COURT OF KARNATAKA

Pragathi Concretes and Construction vs Commissioner of Commercial Taxes*

S SUNIL DUTT YADAV, J.

WRIT PETITION NO. 37976 OF 2025 (T-RES) JANUARY 14, 2026

Assessment - Non-filers of returns - Belated return filing - Periods March, 2023-July, 2023 - Adjudication orders were passed under section 62 on premise that assessee had not filed returns for relevant months - Assessee submitted that returns were filed belatedly for said periods after 3 to 5 months of date of assessment orders - Assessee submitted that belated returns might be taken note of and adjudication orders should be passed on basis of returns filed - Assessee further submitted that delay was due to bonafide reasons and Court should take note of same and pass appropriate orders considering substantive rights involved, as well as taking note that adjudication orders passed under Section 62 are on basis of turnover of previous 6 months - HELD : Adjudication orders were passed under section 62 with liberty to assessee to file returns within 30 days - Adjudication orders passed under section 62 are not on basis of returns filed - Assessee was to be afforded another chance by directing that returns of assessee filed though belatedly might be taken on record reserving liberty to authorities to take note of returns filed and proceed to adjudicate same in terms of sections 73 or 74 as case may be - In light of lapse of assessee of having filed returns belatedly, assessees should pay cost [Section 62 of Central Goods and Services Tax Act, 2017/Karnataka Goods and Services Tax Act, 2017] [Paras 8 and 9] [In favour of assessee/Matter remanded]

Ms. Bhargavi S V., Adv. for the Petitioner. Smt. Jyothi M. Maradi, HCGP for the Responden.

Order

1. Petitioner has sought for issuance of writ of certiorari to set aside the order of adjudication for the period of March 2023 in terms of the order dated 23.05.2023. Similarly, petitioner has called in question the validity of the adjudication orders for the periods of April 2023, June 2023 and July 2023. Petitioner has also sought for issuance of writ of mandamus to direct the respondents to consider the returns filed by the petitioner. Further, relief is sought as regards recovery, sought to be initiated on the basis of the adjudicating orders passed.
2. It must be noticed that for the periods referred to above i.e., for the periods of March 2023, April 2023, June 2023 and July 2023, adjudication orders have been passed on the premise that the petitioner had not filed returns. The said orders were passed under Section 62 of the Central Goods and Services Tax Act, 2017 (for short 'the GST Act'). It is further submitted by the learned counsel for the petitioner that returns were filed belatedly for the periods March 2023, April 2023, June 2023 and July 2023 as per the following:

• It is submitted that the belated returns may be taken note of and the adjudication orders set aside while directing the authorities to proceed with adjudication on the basis of the returns filed.
• Learned High Court Government Pleader appearing for the revenue would submit that the orders of adjudication that were passed were with a condition that if returns were filed within 30 days of the order passed under Section 62 of the GST Act, the orders would stand withdrawn. It is submitted that no returns for the said period were filed within 30 days of the order of adjudication and accordingly, the relief sought for by the petitioner cannot be considered.
• Section 62 of the GST Act reads as follows:

"62. Assessment of non-filers of returns.-

• Notwithstanding anything to the contrary contained in section 73 or section 74 3[or section 74A], where a registered person fails to furnish the return under section 39 or section 45, even after the service of a notice under section 46, the proper officer may proceed to assess the tax liability of the said person to the best of his judgement taking into account all the relevant material which is available or which he has gathered and issue an assessment order within a period of five years from the date specified under section 44 for furnishing of the annual return for the financial year to which the tax not paid relates.
  • Where the registered person furnishes a valid return within 1[sixty days] of the service of the assessment order under sub-section (1), the said assessment order shall be deemed to have been withdrawn but the liability for payment of interest under sub-section (1) of section 50 or for payment of late fee under section 47 shall continue. Provided that where the registered person fails to furnish a valid return within sixty days of the service of the assessment order under subsection (1), he may furnish the same within a further period of sixty days on payment of an additional late fee of one hundred rupees for each day of delay beyond sixty days of the service of the said assessment order and in case he furnishes valid return within such extended period, the said assessment order shall be deemed to have been withdrawn, but the liability to pay interest under sub-section (1) of section 50 or to pay late fee under section 47 shall continue."
• It is not in dispute that the order of adjudication for the period of March 2023, April 2023, June 2023 and July, 2023 has been passed with liberty to the petitioner to file returns within 30 days. It is to be noticed that the orders of adjudication are passed under Section 62 of the GST Act.
• Learned counsel for the petitioner submits that the delay was due to bonafide reasons and the Court may take note of the same and pass appropriate orders considering the substantive rights involved, as well as taking note that the adjudication orders passed under Section 62 are on the basis of turnover of the previous 6 months.
• Taking note of the purport of Section 62 of the GST Act and the adjudication order passed are not on the basis of returns filed, it would be appropriate to afford the petitioner another chance by directing that the returns of the petitioner filed though belatedly may be taken on record reserving liberty to the authorities to take note of the returns filed and proceed to adjudicate the same in terms of Sections 73 or 74 of the GST Act as the case may be, in accordance with law. All contentions of the petitioner are kept open. In light of the lapse of the petitioner of having filed the returns belatedly, petitioners to pay cost of Rs.25,000/- to the High Court Legal Services Authority.
• Accordingly, the adjudication orders at Annexures-C, C1, D, D1, E, E1, F and F1 are set aside with a further direction that on the basis of returns filed though belatedly for the respective periods, respondent - Authorities to proceed for adjudication as per law. The said orders of adjudication would have the legal effect of orders being withdrawn in terms of proviso to Section 62 of the GST Act.
• Accordingly, the petition is disposed of. All contentions are kept open.

Source: taxmann.com